The Evolving Role of the Labour Court in Review

Proceedings

The Grounds for Review• Section 145(2) of the Labour Relations Act:

“A defect referred to in subsection (1) means— (a) that the commissioner—

(i) committed misconduct in relation to the duties of the commissioner as an arbitrator;(ii) committed a gross irregularity in the conduct of the arbitration proceedings; or(iii) exceeded the commissioner’s powers; or

(b) that an award has been improperly obtained.”

• Procedural grounds• Intentionally narrow – CCMA awards as final and binding

The Grounds for Review (cont.)Carephone (Pty) Ltd v Marcus NO & others [1998] 11 BLLR 1093 (LAC)

“…is there a rational objective basis justifying the connection made by the administrative decision-maker between the material properly available to

him [or her] and the conclusion he or she eventually arrived at?”

• “Rational Justifiability”– Section 33 read with item 23(b) of Schedule 6 to the Interim Constitution– Located within section 145(2)(a)(iii) – BUT County Fair Foods (Pty) Ltd v CCMA & others [1999] 11 BLLR 1117 (LAC): Gross

irregularity / misconduct

The Grounds for Review (cont.)Carephone (Pty) Ltd v Marcus NO & others (cont.)

• Substantive ground – Broader than procedural grounds – Measure of scrutiny of merits permissible– Requires:

• Rationality in outcome of CCMA arbitration awards • Rational connection between evidence and reasons AND reasons and

award?

The Grounds for Review (cont.)Sidumo & another v Rustenburg Platinum Mines Ltd & others [2007] 12 BLLR 1097

(CC)

“…Section 145 is now suffused by the constitutional standard of reasonableness… Is the decision reached by the commissioner one that a reasonable decision-maker could not reach?”

“Applying it will give effect not only to the constitutional right to fair labour practices, but also to the right to administrative action which is lawful,

reasonable and procedurally fair.”

• Substantive ground – Requires reasonableness in outcome – BUT correctness not required: “band of reasonableness “

The Grounds for Review (cont.)Sidumo (cont.)

• Broader than Carephone? – Section 33 of final Constitution vs Section 24 of Interim Constitution– Transparency, accountability & openness– BUT minor technicalities?

Giving meaning to Section 145Reunert Industries (Pty) Limited t/a Reutech Defence Industries v Naicker & others

[1997] 12 BLLR 1632 (LC)

• Section 145 defects:– Ordinary meaning in accordance with aims and objects of LRA – Reference to Arbitration Act 1965 and/or other statutes may provide guidance (although

compulsory nature of CCMA arbitration proceedings to be taken into account)

• Misconduct– Wrongful or improper conduct by Commissioner – requires personal turpitude – Ordinarily bona fide mistakes of law or fact not included BUT gross errors may evidence

misconduct– Gross carelessness may amount to misconduct

Giving meaning to Section 145 (cont.)Reunert Industries (cont.)

– Gross irregularity– Not every irregularity: must be gross and material– Bona fide decisions may be grossly irregular (ie: personal turpitude not required)– BUT if committed maliciously, may constitute misconduct– Patent or latent:

• Toyota South Africa Motors (Pty) Ltd v Radebe & others [2000] 3 BLLR 243 (LAC)– Patent irregularities: defects in way in which proceedings conducted– Latent irregularities: defects ascertainable only from reasons given by

administrator; irregularity must prevent fair trial of the issues– Not a fair hearing if Commissioner misconstrues functions (eg: in determining

appropriateness of sanction) egregiously

Giving meaning to Section 145 (cont.)Reunert Industries (cont.)

– Gross irregularity• Ellerine Holdings Ltd v CCMA & others [2008] JOL 22087 (LAC):

– "judgment calls“ NOT gross irregularities– “When all of the evidence is taken into account, when there is no

irregularity of a material kind in that evidence was ignored, or improperly rejected, or where there was not a full opportunity for an examination of all aspects of the case, then there is no gross irregularity ...”

Giving meaning to Section 145 (cont.)• Sidumo (CC)

– Ngcobo J:“It is plain from these constitutional and statutory provisions that CCMA arbitration proceedings should be conducted in a fair manner. …where a commissioner fails to apply his or her mind to a matter which is material to the determination of the fairness of the sanction, it can hardly be said that there was a fair trial of issues.”

“[W]here a commissioner fails to have regard to the material facts, the arbitration proceedings cannot, in principle, be said to be fair … the commissioner’s action prevents the aggrieved party from having its case fully and fairly determined. This constitutes a gross irregularity in the conduct of the arbitration proceedings, as contemplated by section 145 (2)(a)(ii) of the LRA. And the ensuing award falls to be set aside not because the result is wrong but because the commissioner has committed a gross irregularity in the conduct of the arbitration proceedings.”

Giving meaning to Section 145 (cont.)Reunert Industries (cont.)

– Excess of Powers– Commissioner exceeds powers conferred by LRA, including discretionary powers (eg:

Commissioner strays from ambit of jurisdiction or makes ruling or award beyond powers conferred by LRA)

Moloi v Euijen & others [1997] 8 BLLR 1022 (LC)- Award improperly obtained- Distinct from misconduct- Involves party to arbitration, through fraud or other improper means, obtaining award

in his or her favour (eg: bribes; false or fraudulent representations or evidence)- Overlaps with misconduct where party bribes Commissioner

Some recent examples• Sampson Associates (Pty) Ltd t/a Interbrand Sampson v Cities Shepherd & others

[2010] 7 BLLR 746 (LC)– Misconduct– Serious errors of law or fact may constitute misconduct– LC: Commissioner failed to consider highly relevant evidence AND failed to determine

substantive fairness of dismissal = misconduct warranting review

• Jafta v Commission for Conciliation, Mediation & Arbitration & Others (2006) 27 ILJ 2368 (LC)- Gross irregularity- Commissioner placed onus of establishing fairness of dismissal on employee rather than

employer = gross irregularity rendering award reviewable

Examples (cont.)• Sasol Mining (Pty) Ltd v Commissioner Nggeleni & others [2011] 4 BLLR 404 (LC)

– Gross irregularity– Where outcome of proceedings would have differed but for Commissioner’s irregularity

= gross irregularity justifying review– Commissioner failed to consider credibility and reliability of witnesses OR inherent

probabilities of parties’ competing versions: Failed to resolve factual dispute at all!– Award may have differed if not for failure: reviewable due to gross irregularity

• United National Breweries (SA) Ltd v Khanyeza & others [2006] 4 BLLR 321 (LAC)– Excess of powers– Commissioner awarded 14 months remuneration as compensation – Excess of powers: award reviewable

*See also: National Commissioner of the SAPS & another v Cohen NO & others[2009] 3 BLLR 239 (LC)

The Relationship between section 145 & reasonableness

• Remains uncertain…

• Fidelity Cash Management Service v CCMA & others [2008] 3 BLLR 197 (LAC) – Section 145 suffused by standard of reasonableness BUT grounds remain

applicable*See also National Union of Mineworkers v Samancor Ltd (625/10) [2011] ZASCA

74 (25 MAY 2011)BUT

• Kievits Kroon Country Estate (Pty) Ltd v CCMA & others [2010] JOL 26444 (LC)– Section 145 grounds = no longer part of our law– Reasonableness = test for review

The Relationship between section 145 & reasonableness (cont.)

• Ellerine Holdings Ltd v CCMA & others [2008] JOL 22087 (LAC)– When considering meaning of reasonableness, Carephone NB

• Excess of powers? BUT

“Once the issue of gross irregularity cannot pass muster neither can the result of an outcomes based enquiry, namely the reasonableness of the award, be helpful to respondents.”

• CUSA v Tao Ying Metal Industries and others 2009 (1) BCLR 1 (CC)– O’Regan J:

“…the failure by the Commissioner to apply her mind to the question…deprived the award of rationality… it should be set aside on that ground.”

The Relationship between section 145 & reasonableness (cont.)

• Bestel v Astral Operations Ltd and Others (JA 37/08) [2010] ZALAC 19 (16 September 2010) – Overlap between reasonableness and section 145 grounds?– Myburgh: A decision will be unreasonable IF the finding is:

• unsupported by any evidence• based on speculation by the commissioner• entirely disconnected from the evidence• supported by evidence that is insufficiently reasonable to justify the

decision OR• made in ignorance of evidence that was not contradicted

The impact of uncertainty in practice?

• Alcohol related dismissalsMondi Paper Co v Dlamini [1996] 9 BLLR 1109 (LAC)– Proper approach to determining fairness of alcohol related dismissals

• TEST: Did the employee’s drunkenness impair his ability to work?– Employee drunk on duty – dismissed– IC: Dismissal unfair – employee reinstated– FACTS:

• Employer’s disciplinary code: dismissal for intoxication, even if first offence• IC accepted validity of rule BUT held employee had not been “drunk” only “under

the influence of alcohol” NOTWITHSTANDING:– breathalyser test’s confirmation of employee’s consumption of alcohol in

excess of prescribed limit AND colleagues’ assertions that employee’s behaviour suggested intoxication

The impact of uncertainty (cont.)Mondi Paper Co v Dlamini (cont.)

• LAC: Upheld IC’s decisionWHY? No evidence that alcohol consumption impaired ability to work• Mitigating circumstances further assisted the employee, including:

– The employee’s 8 years of service– The employee’s clean disciplinary record – The employer’s concessions that the employee = “a good worker” and that

the incident in question = entirely out of character

Astore Africa (Pty) Ltd v CCMA & others [2008] 1 BLLR 14 (LC)• Employee (formerly employed as a driver) dismissed for driving company vehicle

while under the influence of alcohol AND simultaneously making delivery to customer

The impact of uncertainty (cont.)Astore Africa (Pty) Ltd v CCMA & others (cont.)

• Customer’s security guards suspected intoxication – subjected employee to breathalyser test = positive

• Employee returned to work & called to HR office – instructed to leave premises• Employee belligerently refused• Employee subsequently dismissed• Employer testified that employee had:

– smelt of alcohol– had markedly red eyes – slurred his speech

• CCMA: – TEST: Did alcohol consumption impair ability to work?– NO: dismissal unfair

The impact of uncertainty (cont.)Astore Africa (Pty) Ltd v CCMA & others (cont.)• LC upheld CCMA’s finding:

“The question was whether the employee would not have been able to perform his duties because of the consumption of alcohol. In answering this question, the commissioner concludes that the applicant had to prove, on the balance of probabilities, that the employee’s ability to drive was affected because of the consumption of alcohol. He found that there was no evidence from the applicant that his ability to carry out his duties was impaired by the consumption of alcohol. The award by the commissioner is rational and justifiable. He arrived at his conclusion after considering and weighing the evidence before him. His reasoning and conclusion is beyond reproach.”

• Egregious error of law / fact?• Failure to apply the mind?• Too much deference?

The impact of uncertainty (cont.)Scrader Automotive (Pty) Ltd v Metal Industries Bargaining Council and Others

[Unreported decision of the Labour Court] (Case no: P488/05 Judgment date: 26 September 2008)

• Employee (duties included driving), found guilty of alcohol consumption at work – dismissed• FACTS:

– Zero tolerance policy regarding alcohol consumption at work implemented by employer– Policy clearly available to all employees– Employee subjected to breathalyser test – found to have consumed alcohol in excess of

statutorily (& policy) prescribed limit for driving– When confronted, employee admitted to drinking the night before but denied

intoxication

The impact of uncertainty (cont.)Scrader Automotive (Pty) Ltd v Metal Industries Bargaining Council and

Others (cont.)– CCMA: confirmed employee’s guilt BUT dismissal too harsh – reinstated with

limited retrospective effectWHY?– TEST: Employer failed to prove factual inability to perform duties– BUT alcohol content rendered employee legally incapable of driving?– LC?

The impact of uncertainty (cont.)Scrader Automotive (Pty) Ltd v Metal Industries Bargaining Council and Others

(cont.)– LC: Upheld CCMA’s decision

• NB: Deference– BUT : failure to take account of material facts / evidence?

Palaborwa Mining Co Ltd v Cheetham & others (2008) 29 ILJ 306 (LAC)• Employee found guilty of being under the influence of alcohol at work• Employer had clear policy of which employee aware that evidence of alcohol consumption in

excess of stipulated amount warranted dismissal, even in case of a first offence• Mitigating circumstances included:

– Employee’s service history of 8 years– Employee = 58 years old

The impact of uncertainty (cont.)Palaborwa Mining Co Ltd v Cheetham & others (cont.)• CCMA found dismissal = fair

– WHY? Employer’s rational justifications for strict policy warranted dismissal• No indication that Commissioner applied test• LC overturned CCMA’s decision• LAC?

– Willis JA considered reasonableness standard in Sidumo:“a) …reduces the scope for a dissatisfied employee to take his dispute further; andb) reduces the potential for the Labour Courts and the Supreme Court of Appeal to exercise scrutiny over the decisions of commissioners who are appointed to

arbitrate in terms of the LRA.”

The impact of uncertainty (cont.)Mondi v Palaborwa?• Remarkably similar facts

Mondi– Employee not guilty of drunkenness BUT guilty of alcohol consumption (breathalyser)– Mitigating circumstances prevailed:

• Service history of 8 years; ostensibly first offence• Employer had clear policy against alcohol consumption –employee aware of policy

Palaborwa– Employee admitted alcohol consumption & submitted to positive breathalyser test– No further evidence of intoxication– Mitigating circumstances:

• Service history of 8 years; ostensibly first offence• Employer had clear policy against alcohol consumption –employee aware of policy

The impact of uncertainty (cont.)• Mondi v Palaborwa? (cont.)

Why the discrepancy?

– Extreme deference? VS– Failure to consider section 145 grounds at all? (Eg: gross irregularities?)

CONCLUSIONS & QUESTIONS?